Rio Tinto posts strong quarter

Denver — The fourth quarter of 2000 was highlighted by a 40% increase in iron ore production and a 24% rise in aluminum production for Rio Tinto (RTP-N).

The increase is attributed to the company’s acquisition of North Ltd. of Australia and to the purchase of minority interests in Rio’s aluminum subsidiary, Comalco.

Rio Tinto took control of North in a US$1.7-billion deal at the beginning of the 3-period. The Robe River operation in Western Australia, part of the North transaction, reported record shipments for the year.

Rio Tinto produced 23.2 million tonnes of iron ore during the fourth quarter, and 72.5 million tonnes for the year.

The London-based major intends to increase its 56.1% stake in Iron Ore Co. of Canada, which it picked up in the North deal, by offering to purchase the 18.9% stake in IOC held by the Labrador Iron Ore Royalty Income Fund (LIF.UN-T).

The offer is still pending, though the fund has commissioned CIBC World Markets to prepare a compulsory evaluation. In the meantime, the fund has Scotia Capital scouting for other potential buyers.

In July, Rio Tinto completed the A$1.5-billion acquisition of the 27.6% of its aluminum subsidiary, Comalco, that it did not already own. This boosted output to 194,900 tonnes in the fourth quarter, and 692,300 tonnes for the year.

During the year, Rio Tinto also purchased Ashton Mining, increasing its ownership of the Argyle diamond mine in Australia to nearly 100%, as well as exploration potential in Canada, through Ashton Canada.

Copper production for Rio Tinto during the year was up 4%, while coal production tailed off 5% for the year. Gold production was down 9% to 2.7 million oz.

Western Copper Holdings (WTC-T) holds a 100% interest in the Penasquito base metal property in Mexico, and Kennecott no longer has a 51% back-in right. In our Jan. 22-28 issue, we incorrectly stated that Western Copper is still earning its interest.